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Topic 1 Lamb, Hair, and McDaniel, (2016)
MKTG9 Cengage Learning
Chapter 1
An Overview of Marketing
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1-1 Define the term marketing 1-2 Describe four marketing management
philosophies 1-3 Discuss the differences between sales and
market orientations 1-4 Describe several reasons for studying
marketing
LEARNING OUTCOMES
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1. A philosophy, an attitude, a perspective, or a management orientation that stresses customer satisfaction.
2. An organizational activity, set of institutions, and processes.
Marketing is…
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Marketing is the activity, set of institutions, and processes for
creating, communicating, delivering, and exchanging offerings that have
value for customers, clients, partners, and society at large.
American Marketing Association Definition of Marketing
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Marketing… Entails processes that focus on delivering value and benefits to customers, not just selling goods and services.
Exchange
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At Least Two Parties
Something of Value
Communication and Delivery
Freedom to Accept or Reject
Desire to Deal with Other Party
Conditions for Exchange
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Exchange
• Exchange may not take place even if conditions are met.
• An agreement must be reached.
• Marketing occurs even if exchange does not take place.
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Marketing Management Philosophies
Describe four marketing
management philosophies
1-2
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Sales
Market
Societal
Production internal capabilities of the firm
satisfying customer needs and wants while meeting objectives satisfying customer needs and wants while enhancing individual and societal well-being
aggressive sales techniques and belief that high sales result in high profits
Orientation Focus is on…
The Four Marketing Management Philosophies
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Production Orientation
Field of Dreams orientation – “If you build it, they will come.” – Doesn’t consider if what is produced
meets market needs
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Sales Orientation
Marketing = Selling Things & Collecting Money
• Disregards market needs and consumer demand.
• Despite the quality of sales force, often cannot convince people to buy what is neither wanted nor needed.
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Market Orientation
Focusing on customer wants and needs to distinguish products from competitors’ offerings
Integrating all the organization’s activities to satisfy these wants
Achieving the organization’s long-term goals by satisfying customer wants and needs legally and responsibly
Marketing Concept
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Achieving a Marketing Orientation
Obtain information about customers, competitors, and markets
Examine the information from a total business perspective
Determine how to deliver superior customer value
Implement actions to provide value to customers
Societal Marketing Orientation
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An organization exists not only to satisfy customer wants but also to
preserve or enhance individuals’ and society’s long-term best interests.
For example: • Less toxic products • More durable products • Products with reusable or recyclable materials
Who’s In Charge?
Increased availability of comparative research enables customers to shop smarter, putting the customer in the
driver seat.
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Questions That Help Determine Marketing Philosophy
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Production
Sales
Marketing
Societal
What can we make or do best?
How can we sell more aggressively?
What do customers want and need?
What do customers want/need, and how can we benefit society?
Orientation Focus
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Differences between Sales and Market Orientations
Discuss the differences between
sales and market orientations
1-3
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Comparing the Sales and Market Orientations
5 characteristics: • Organization’s focus • Firm’s business • Those to whom the product is
directed • Firm’s primary goal • Tools the organization uses to
achieve its goals
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The Organization’s Focus
Sales Orientation Inward looking
What the firm makes
Market Orientation Outward looking
What the market wants
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Offer products that perform
Earn trust
Avoid unrealistic pricing
Give the buyer facts
Offer organization-wide commitment in service and after-sales support
Co-creation with customers
Customer Value Requirements
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The customers’ evaluation of a good or service in terms of
whether that good or service has met their needs and
expectations.
Customer Satisfaction
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Strategy that focuses on keeping and improving relationships with customers. Successful strategies need:
– Customer-Oriented Personnel – Effective Training Programs – Empowered Employees – Teamwork
Relationship Marketing
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Building Relationships Customer-oriented personnel
Every employee represents the firm in the eyes of the customer.
Employee training programs Empowered employees
Employees are given more authority to solve customer problems on the spot.
Teamwork Emphasizing cooperation over
competition while helping a customer.
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Defining a Firm’s Business
Sales Orientation Goods and Services
Market Orientation Benefits that customers seek
Knowing the Firm’s Business:
• Ensures a customer focus • Encourages innovation and creativity • Stimulates an awareness of changes in
customer preferences
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Sales vs. Market Orientations
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Sales Orien-tation
Market Orien-tation
Organization’s Focus
Firm’s Business
For Whom?
Primary Profit Goal?
Tools to Achieve
Selling goods and services
Everybody Maximum sales volume
Primarily promotion
Inward
Outward Coordin-ated use of marketing activities
Customer satisfac-tion
Specific groups of people
Satisfying wants and needs
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Why Study Marketing?
Describe several reasons for studying
marketing
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